The Long-Term Effects of Customer-Oriented Sales Promotions

Consumer-oriented sales promotions that include price markdowns, coupons, rebates and other inducements become increasingly important as competition increases in your industry and competitors utilize promotions on a regular basis. The long-term effects of customer-focused promotions carry both negative and positive ramifications that you must consider when preparing your marketing plans.

Loyalty

1. When customers know they can always find a coupon or a sale, they become inured to the inducements. Sales and coupons begin to lose their effectiveness when they are constant. Sales don't mean anything when they are too common. Additionally, your sales may get lost in the clutter of similar advertising and marketing in the newspapers, on TV or through electronic or traditional mail. To combat the consumer overload, many retailers turned to loyalty cards as their primary incentive to bring customers back. Find some way to reward regular customers to help you stand out in the crowd.

Poor Image

1. When customers always see your service or products on sale, their confidence in the quality of your work may become eroded, according to the University of Dayton. Instead of building confidence in the quality of your business, you may be undermining your value in the minds of consumers with too many promotions. They may begin to question the validity of your service if it's always on sale. Additionally, when they see continuous promotional campaigns, customers may postpone a purchase because they know if they wait, it will be on sale soon.

Value-added

1. Value-added promotions such as a free instructional course with every purchase, complementary training, bonus points toward future purchases or free trials build customer retention because customers appreciate the effort you put out to earn their business. Unlike coupons and discounts that are short-term, you can build relationships with customers that have long-term effects with promotions that add value to the customer purchase. When combined with a loyalty discounts, you can develop a long-term strategy to build customer confidence, increase your referral rate and boost your brand identity.

Boost Profits

1. Regular sales and marketing promotions can affect your bottom line in the long run. If you hold regular discounts, you usually can expect increased sales during those times. The total profit from the sales increases your company's annual profits and may make up for slow periods of sales. When planning your annual budget, you can take into account planned promotions you know will bring in additional sales. As part of a long-term budgeting plan, customer-oriented promotions can play a significant role in boosting your profits.